OTTAWA - The Canadian government will give C$867 million (US$642.2 million) in financial support to Canadian lumber producers and exporters to help them withstand the impact of new U.S. tariffs on Canadian softwood exports.

In April, Washington imposed preliminary anti-subsidy duties averaging around 20 percent on imports of Canadian softwood lumber. Canada thinks the duties are unfair.

"Canadian workers are under pressure because of duties which are unfair and punitive," said Foreign Minister Chrystia Freeland. 


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"We're not going to let those Canadian workers, those Canadian families, be hurt and stand idly by. We're going to help,"  she said.

The U.S. Lumber Coalition, responsible for the complaint which triggered the duties, is calling the package another subsidy.

"The new funding adds to existing government subsidies boosting the Canadian softwood lumber industry, creating an uneven playing field with the U.S. lumber industry and putting American jobs at risk," the group said in a news release.

Tensions have increased between the U.S. and Canada and there are even talks to renegotiate the North American Free Trade Agreement.

C$500 million of the aid will be in the form of federal loans and loan guarantees for viable Canadian firms. Export Development Canada (EDC) will make commercial financing and risk management solutions to assist viable forestry companies.


U.S. to levy anti-subsidy duties of 20 percent on Canadian softwood lumber

The U.S. government will impose tariffs on Canadian softwood lumber following a Commerce Department determination that Canada subsidizes softwood lumber production.

The Business Development Bank of Canada (BDC) will make $105 million in commercial financing available to help eligible forestry companies in the short and medium term. Funding for further loan guarantees may be considered by the government in the future to address changing market conditions.

The support also includes investments to diversify forest products and markets, in an effort to increase Canada’s resilience to any future trade actions.

Over $260 million will go toward:

  • Support efforts to expand overseas markets and promote the diversification of Canadian wood products beyond those targeted by U.S. duties on softwood lumber;
  • Help Indigenous communities and organizations improve the performance of their forest sector initiatives;
  • Provide a temporary extension of the maximum period for Work-Sharing agreements from 38 to 76 weeks in order to reduce layoffs; and
  • Expand supports to help affected workers upgrade their skills and transition to new opportunities.

“The Government of Canada continues to forcefully press our American counterparts to rescind this unfair and unwarranted trade action while remaining confident that a negotiated settlement is not only possible, but in the best interests of both countries,” the Canadian Government said in a news release.

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